Price Candies (PC) Makes Three Types of Chocolate Candy Bars

question 55

Essay

Price Candies (PC) makes three types of chocolate candy bars. The head of marketing, Nathan Lord found the chart below and believes PC should drop the Almond line. He asks controller, Faye Martin, to review the situation and determine the fate of the Almond Line.

Required:
a. Review the information above and determine the fate of the Almond Line. Prepare your answer in good form. Note: Facility and product level costs are fixed and will not change; they are allocated based upon sales.
b. Prepare a memo defending your position on this important issue.

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Definitions:

Indexed for Inflation

Adjusted for changes in the purchasing power of money, ensuring values remain consistent over time.

Consumer Price Index

An index that measures the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.

Food and Beverage

This refers to the industry that encompasses the preparation, distribution, and service of food and drink products.

CPI

An index measuring the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.